Walmart 2012 Annual Report Download - page 41
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Rent abatements and escalations are considered in the calculation
of minimum lease payments in the Company’s capital lease tests and
in determining straight-line rent expense for operating leases.
Pre-Opening Costs
The costs of start-up activities, including organization costs, related to new
store openings, store remodels, expansions and relocations are expensed
as incurred and included in operating, selling, general and administrative
expenses in the Company’s Consolidated Statements of Income. Pre-opening
costs totaled $308 million, $320 million and $227 million for the fi scal years
ended January 31, 2012, 2011 and 2010, respectively.
Currency Translation
The assets and liabilities of all international subsidiaries are translated
from the respective local currency to the U.S. dollar using exchange rates
at the balance sheet date. Related translation adjustments are recorded
as a component of accumulated other comprehensive income (loss). The
income statements of international subsidiaries are translated from the
respective local currencies to the U.S. dollar using average exchange
rates for the period covered by the income statements.
Reclassi cations
Certain reclassifi cations have been made to prior fi scal year amounts or
balances to conform to the presentation in the current fi scal year. These
reclassifi cations did not impact consolidated operating income or net
income. Additionally, certain segment asset and expense allocations
have been reclassifi ed among segments in the current period. See Note
15 for further detail.
Recent Accounting Pronouncements
In 2011, the Financial Accounting Standards Board (“FASB”) issued two
Accounting Standards Updates (“ASU”) which amend guidance for the
presentation of comprehensive income. The amended guidance requires
an entity to present components of net income and other comprehensive
income in one continuous statement, referred to as the statement of
comprehensive income, or in two separate, but consecutive statements.
The current option to report other comprehensive income and its
components in the statement of shareholders’ equity will be eliminated.
Although the new guidance changes the presentation of comprehensive
income, there are no changes to the components that are recognized in
net income or other comprehensive income under existing guidance.
These ASUs are eff ective for the Company in the fi rst quarter of fi scal 2013
and retrospective application will be required. These ASUs will change the
Company’s fi nancial statement presentation of comprehensive income but
will not impact the Company’s net income, fi nancial position or cash fl ows.
In 2011, the FASB issued an ASU, which is intended to reduce complexity
and costs by allowing an entity the option to make a qualitative evaluation
about the likelihood of goodwill impairment to determine whether it
should calculate the fair value of a reporting unit. The ASU also expands
upon the examples of events and circumstances that an entity should
consider between annual impairment tests in determining whether it is
more likely than not that the fair value of a reporting unit is less than its
carrying amount. The ASU is eff ective for the Company in the fi rst quarter
of fi scal 2013, with early adoption permitted. The Company early adopted
the provisions of the ASU in fi scal 2012 for its fi scal 2012 goodwill
impairment test.
2 Net Income Per Common Share
Basic income per common share from continuing operations
attributable to Walmart is based on the weighted-average common
shares outstanding. Diluted income per common share from continuing
operations attributable to Walmart is based on the weighted-average
number of outstanding common shares adjusted for the dilutive eff ect
of stock options and other share-based awards. The Company had
approximately 1 million, 4 million and 5 million stock options outstanding
at January 31, 2012, 2011 and 2010, respectively, which were not included
in the diluted income per common share from continuing operations
attributable to Walmart calculation because their eff ect would
be antidilutive.
The following table provides a reconciliation of the numerators and
denominators used to determine basic and diluted income per common
share from continuing operations attributable to Walmart:
Fiscal Years Ended January 31,
(Amounts in millions, except per share data) 2012 2011 2010
Numerator
Income from continuing operations $16,454 $15,959 $14,962
Less consolidated net income
attributable to noncontrolling
interest (688) (604) (513)
Income from continuing operations
attributable to Walmart $15,766 $15,355 $14,449
Denominator
Weighted-average common shares
outstanding, basic 3,460 3,656 3,866
Dilutive impact of stock options
and other share-based awards 14 14 11
Weighted-average common shares
outstanding, diluted 3,474 3,670 3,877
Net income per common share
from continuing operations
attributable to Walmart
Basic $ 4.56 $ 4.20 $ 3.74
Diluted 4.54 4.18 3.73
Notes to Consolidated Financial Statements